Foreign Affairs Committee on Nov. 16th, 2010

[Paul Dewar, NDP, Ottawa Centre, ON]

Thank you.

Thanks, Chair.

[The Chair, Conservative, Dean Allison]

We're going to move back here for a second round of five minutes.

We'll start with Ms. Brown and then we'll go to Mr. Lunney.

[Lois Brown, Conservative, Newmarket—Aurora, ON]

Thank you, Mr. Chair. I'll be brief.

Mr. Rourke, if I may, I'll ask a couple of questions of you. Hernando De Soto, in his book The Mystery of Capital, talks about the need in developing countries for contract law to be able to be judged in a court of law. Could you talk about that a little bit in regard to the work that you're doing in helping...? You're helping to establish enterprise, really, in countries and you're helping them to build their capacity. Are you having any influence in that regard?

[Phil Rourke]

That's interesting. We're developing a project on increasing access to finance for small businesses in the Caribbean, and the question is exactly what you're asking about. The basic problem is there are very few things that people can use as collateral to get credit, whereas in our country and a lot of developed countries, you can use furniture, you can use the cargo on a ship--all kinds of different things.

Second, from a development perspective, there may be a house and a car or something like that. These tend to be owned by the men in the household. The women don't have any access to credit, but they might have jewellery or family heirlooms or different kinds of things. To address this, there are all kinds of different ways, but one of the key things is to change the laws and the regulations to allow these kinds of things and to create greater certainty within the financial market for it to lend to small businesses.

This is at the very micro level and is more domestically oriented than internationally oriented, but that's the direction that a lot of these things are going in. De Soto very much talked about private property rights and using them to access credit. You see these kinds of projects all around the world. There's a strong emphasis on these kinds of things.

[Lois Brown, Conservative, Newmarket—Aurora, ON]

The reality is that for all the investment a government may make, with CIDA perhaps going in and making a contribution in a country, unless contract law can be upheld, other investment is not going to come in and help build a foundation there where enterprise can grow.

[Phil Rourke]

The question is to get people from the informal economy into the formal economy.

[Lois Brown, Conservative, Newmarket—Aurora, ON]

Absolutely.

[Phil Rourke]

There are various ways of doing that, but contracts are part of that, and then there is accounting and there are all kinds of other things. There are a lot of things that governments and donor agencies are doing in order to move that into the formal economy so that it can regularize. It's all under what you're talking about: the rule of law and applying it.

[Lois Brown, Conservative, Newmarket—Aurora, ON]

Mr. Lunney.

[James Lunney, Conservative, Nanaimo—Alberni, BC]

Thank you.

Mr. Rourke, I understand that a large percentage of Mongolia's exports actually go to China. Your organization has some experience in dealing with China and the other big neighbour, Russia. Given the situation as you assess it today, do you see a role for your organization to play in helping to expand capacity there? Or, given the suite of problems described by His Excellency, do you think that's a little premature for the expertise of your particular organization and that maybe it's more for the role of the Public Service Commission and organizations like CESO at this time? Or all of the above?

[Phil Rourke]

Well, China is a developing country, but also has a lot of money in other areas, so for the trade stuff we do, in my mind they should pay for it, and they do.

We finished working in Russia several years ago, but we continue to get contracts, including from the government. I remember the discussion, which was, “Well, Max, they're asking us why the Government of Canada should pay for this if it's so valuable”. Our partner said, "Yes, that's a good point".

But I think that's different from Mongolia. In Mongolia, it's a much different situation. I've been there. It's much more rural. They're landlocked. They have a lot more constraints in terms of what they can do. They're trying to develop their own companies and build them while there's a lot of investment from different places. Basically, they're trying to manage what they have, so I wouldn't take the lessons from China and Russia and apply them. Hopefully we can apply them in 10 or 15 years when they've gotten to a different level of economic development. The dynamics are different and that's why donors move from different country to different country over time in terms of where their priorities are--at least that's how I understand it.

[James Lunney, Conservative, Nanaimo—Alberni, BC]

Ms. Lee, regarding CESO and given the suite of challenges you've seen from Mongolia--I don't know how much chance you've had to study Mongolia--do you see a role with the expertise in your membership? You draw on quite a number of Canadians who are retired. Do you see that you'd have a role to play, with appropriate support from the host government and CIDA?

[Gale Lee]

Oh, yes, I do see a role. I have done a bit of reading and I've seen some of the presentations made by the Mongolian officials. The important thing I see is that the Mongolian government is very proactive in promoting the rule of law and effective government and introducing good governance practices.

I think there are places where with CESO's expertise--this and work we've done before--we can fill a gap. Obviously we won't replicate exactly, but we can work within the local situation and adapt the experience we've had to the Mongolian situation. I can see where we can certainly fill a gap there, based, again, on the level of commitment I've seen from the Government of Mongolia and the efforts they have made so far.

[The Chair, Conservative, Dean Allison]

Thank you very much.

We'll move back to Mr. Pearson for five minutes.

[Glen Pearson, Liberal, London North Centre, ON]

Thank you, Chair.

Miss Lee and Mr. Rourke, when Maria Barrados was here from the Public Service Commission she talked about the extent of the work that Canada will probably be doing in these areas in the future. As emerging democracies continue to grow and expand, we're going to need to have more capacity to be able to do the kind of effective work that you have done. I appreciate what you've have said today.

In her testimony here a couple of weeks ago, she said:

...the amount of time and effort that can be directed to these projects, both at the PSC and across the public service, is limited since very few special resources are dedicated to these projects. The demand for our expertise and assistance is greater than the resources available.

She also said that “we need to bring these significant resources together through some effective networks”.

Do you see something that's kind of there, something that's growing and emerging that could establish that network so all the various groups could come together to be able to do it? She feels that for her organization--and likely for yours as well--as more challenges come across, the ability to pull this together is going to be difficult. Do you see something kind of developing that it could fall under?

[Gale Lee]

Yes. I was actually very interested when I read that statement by Mrs. Barrados, because I think there are synergies that can be built among Canadian organizations, where we can work together with our different strengths and support each other to come up with a greater whole. With that greater whole, we can provide the type of assistance that I think Mongolia needs. I don't think any one organization can do it on their own. We need to work together. Even in international development generally now, most donors encourage NGOs or organizations to work together in a consortium.

For example, the Dutch government won't accept a proposal from a single organization. It has to be from a consortium. CIDA is also going that way. Currently we work in Haiti in a consortium with three other NGOs and we all have strengths in various areas. By putting us together, we become a synergistic whole where we can provide much more organized and supportive assistance, which can produce better results, as opposed to working ad hoc.

[Glen Pearson, Liberal, London North Centre, ON]

Do you know if that dialogue is taking place amongst the various groups? Who would you see perhaps providing leadership to that?

[Gale Lee]

Well, first off, I would like to say CESO is interested in starting a dialogue with whoever is interested in working together in a consortium to assist Mongolia. As I said, we have the experience, in that we are doing it now in Haiti with four organizations together. For example, in that project, we have strength in private sector development and governance, so we're doing that part of the project. There's another organization that has strengths in social services and women's issues. We split the responsibilities based on our strengths, but again, we all work together as a whole.

[Phil Rourke]

When I read her testimony, I was thinking that she has a huge organizational problem that her commission probably can't solve for her, because they're not organized to implement international projects. They're organized to do what they do, which is a different mandate.

I've seen this in all kinds of different government agencies: they're asked to do things, but they're not organized that way, and the job descriptions are not written in that way. She can't really pull in people on long-term assignments. The solution is to have an outside organization run the project and bring those people in, through exchanges or secondments or different kinds of things, and have informal links with those agencies. I'm sure there are a lot of people within the commission who are interested in working in Mongolia, but organizationally it would be difficult to do it.

You have a very competitive marketplace in Canada. The development business is very competitive. And who would be the potential organizers for that? There are a lot of public affairs schools at universities that do public sector reform and that could combine the practical experience of the commission with that of some of their academics, who probably go back and forth anyway. You could have a bid for that. I'm sure you would get five or six really interesting proposals on how to organize that and you would get them from across the country.

I think that's what the problem is for her. I don't know the details, but I can see how that would be a concern.

[The Chair, Conservative, Dean Allison]

That's helpful. Thank you.

Monsieur Patry.

[Bernard Patry, Liberal, Pierrefonds—Dollard, QC]

I would like to ask a quick question.

I just want to ask a question to Mr. Rourke or Mrs. Lee. I was reading what you gave us.

First of all, I know about SACO, as it is called in French, because once in a while I receive a note that one of my constituents has worked as a volunteer in SACO. It's very good to know people are involved there from every part of the country.

I notice that in the Philippines you're working in municipalities, and the same is true in Honduras and also in Cameroon, but what are you doing right now in Haiti? Haiti is so close to us, in the sense, of course, that they had flooding there, and now they have cholera. What's your involvement in Haiti right now?

[Phil Rourke]

Gale is responsible for that area.

[Gale Lee]

In Haiti we have a four-year project that's funded by CIDA, and the organizations are CECI, WUSC, and the Paul Gérin-Lajoie foundation. We work with partners in four areas, four cities in Haiti.

Again, there are various aspects. There is an educational aspect, which CECI and the Paul Gérin-Lajoie foundation are doing. In particular, with CESO, which I can tell you more about, we are working with some micro-finance organizations and small associations of women in livelihood projects. We will soon be working with some government agencies to strengthen their institutional strengthening.

It's a challenge right now, as you can see, because there has been a cholera outbreak. We actually had four volunteers who were in Artibonite, which is the part that was hit, and we had to move them temporarily to Jacmel and Port-au-Prince until we were assured by the health authorities that they could return to their partners and do work there. They have returned. It's being very closely monitored by our people on the ground and in the field, and also by the Haitian health authorities.

It's very interesting, because at first we thought those volunteers probably would have wanted to return to Canada, but they actually didn't even want to leave Artibonite because they wanted to help, and they knew they could contribute. They were very happy when they were given the clearance to go back and continue their work. Obviously they're told to take precautions to keep themselves from being affected by cholera, and they are all being closely monitored, but I think it will be a challenge in the future to get people who are willing to go.

[Bernard Patry, Liberal, Pierrefonds—Dollard, QC]

You talk about education with the Fondation Gérin-Lajoie. What specifically are you doing in education? Are there teachers? What's your involvement there with education?

[Gale Lee]

As far as I know from the Fondation Paul Gérin-Lajoie, they're helping with training teachers.